Emmerson Njanjamangezi, Group Features Editor 
BUSINESS has warned that the country’s worsening power cuts, which are blamed on inadequate generation capacity and ageing infrastructure, threaten Zimbabwe’s economic recovery and rising industrial capacity utilisation.
Speaking to The Financial Gazette this week, concerned captains of industry and commerce said the debilitating power disruptions were seriously affecting production at a time that the country’s economy could ill afford fresh knocks, after enduring a hard national coronavirus lockdown for the past 18 months.
Zimbabwe needs between 1 350MW and 1 800MW to meet its daily electricity demand, against a current production capacity of around 1 000 megawatts. The president of the Confederation of Zimbabwe Industries (CZI), Kurai Matsheza, was among the business leaders who said the current power cuts, which were lasting up to 12 hours a day, needed to be mitigated as soon as possible if the economy was to be spared serious damage.
Kurai Matsheza, CZI President
“The power cuts are so disruptive, and it is something that we are talking to the authorities about. But as you know, they have highlighted the challenges that they are having at Kariba and Hwange power stations. “But this is a huge drag on the economy and in terms of capacity utilisation, industrial output will certainly be affected if this is not addressed soonest.
“As we go towards the festive season, production has to be ramped up to create stock for this peak period, but with the non-availability of power, some of that stock build-up will be difficult to achieve,” Matsheza said.
The chief executive of the Zimbabwe National Chamber of Commerce (ZNCC), Chris Mugaga, said so bad were the outages that most companies were now using alternative, but exceedingly expensive sources of power.
“The cost of conventional power in Zimbabwe to business, versus operating without electricity per every unit cost, has gone up by an average of 150 percent.
“This is because we need to resort to generators, solar, etc. Somehow, this feels like an extension of the national Covid-19 lockdown, except that it’s even harder to deal with.
“We had a hard lockdown for the past 18 months and the power shortages have come as an extension of the lockdown of some sort,” Mugaga lamented.
“Also, you will see that the fixed costs of business have gone up on average by 25 percent. This is because business has to pay salaries while productivity is still low.
“This is also a serious dent in terms of the government’s efforts to address the country’s ease-of-doing business environment and the cost of doing business.
“Zimbabwe was moving up the ladder of late but these power outages … will continue challenging us in the immediate term,” he added.
On his part, industrialist and past CZI president, Sifelani Jabangwe, urged authorities to move with greater urgency to improve the country’s power generation capacity to avoid jeopardising improving industrial capacity utilisation.
“What is most important is to repair our power generation infrastructure and to ensure that we are back up to speed as soon as possible with local power production. “This is because power is the key enabler for all of us. Some have an hour or two of outages, but that is what needs to be avoided going into the last quarter of the year.
“We then can provide the goods that are required this peak season that we are going into,” Jabangwe told The Financial Gazette.
This comes as the government has been trying to ramp up power production in the country.
Over the past few years, the Zimbabwe Energy Regulatory Authority has licensed more than 50 independent power producers (IPPs) — including Duru Mini Hydro (2,2MW), Green Fuel (18,3MW), Nyamingura Mini Hydro (1,1MW), Hippo Valley Estates (33MW), Triangle Estates (45MW) and Pungwe Power Station (19MW), in a bid to boost power generation.
Energy and Power Development minister Zhemu Soda
Zesa has attributed the worsening loss of electricity in the country to damage to its antiquated infrastructure, as well the current rehabilitation works at the Kariba dam wall.
This has seen its subsidiary, the Zimbabwe Electricity Transmission and Distribution Company (ZETDC), releasing a paralysing timetable of the new rolling power cuts.
“The ZETDC is experiencing a power shortfall due to generation constraints at Hwange Power Station, limited imports and a programme of dam wall rehabilitation at Kariba which requires that two generators be taken out daily for 12 hours.
“The planned outage of the two units then restricts Kariba Power Station output during these hours. The power shortfall is being managed through load-shedding to balance the power supply available and the connected load.
“It is imperative to note that the programme takes cognisance and gives priority to critical supply points such as major referral hospitals, water and sewer installations, national security establishments, oxygen-producing plants and winter wheat farmers,” ZETDC said.
Zimbabwe normally imports additional power from Mozambique and South Africa’s Eskom to cover its significant deficit, but Pretoria is facing shortages of its own, following an explosion at its Medupi Power Plant, and a recent fire at Kendal, which slashed about 10 percent of its national capacity.
Meanwhile, authorities have promised that power outages will be a thing of the past once the US$1,5 billion expansion project at Hwange — which will add Units 7 and 8 — is completed within the next two years. Each of these units will be expected to generate 300MW of critically needed power.
The return of relentless load shedding comes as business has expressed confidence that Zimbabwe’s sturdy economic performance of the past few months will be maintained for the remainder of this year and into early 2022.
Business leaders who spoke to The Financial Gazette last week — in the wake of continuing macro-economic stability, the accelerating vaccination programme against the coronavirus pandemic and a further lightening of the national lockdown, which has seen a welcome return to normal business trading hours — also said indications were that the government’s ambitious economic growth forecast of 7,8 percent for the year could be within reach.
This comes after the recent release of nearly US$1 billion to Zimbabwe by the International Monetary Fund (IMF), through its Special Drawing Rights (SDRs), which has further lifted business sentiment in the country. At the same time, business has since implored authorities to spend at least half of the IMF windfall on the productive sector, to further stimulate economic growth and help companies to recover from the negative effects of Covid-19.
newsdesk@fingaz.co.zw
